# Test: Theory Of Cost- 1

## 30 Questions MCQ Test Crash Course of Micro Economics -Class 12 | Test: Theory Of Cost- 1

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Attempt Test: Theory Of Cost- 1 | 30 questions in 30 minutes | Mock test for CA Foundation preparation | Free important questions MCQ to study Crash Course of Micro Economics -Class 12 for CA Foundation Exam | Download free PDF with solutions
QUESTION: 1

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QUESTION: 2

Solution:
QUESTION: 3

### Which of the following curve is not U shaped?

Solution:

The Average fixed cost curve represent the relationship between average fixed cost and quantity produced. It is relatively high when the quantity of output is small and declines as the quantity produced increases. AFC curve is negatively sloped and therefore can not be U shaped.

QUESTION: 4

Fixed cost is known as _______cost.

Solution:

Fixed costs are expenses that have to be paid by a company, independent of any specific business activities. Fixed cost is known as Overhead cost.

QUESTION: 5

The cost of resources owned and employed by the entrepreneur himself in his business is termed as ________ cost.

Solution:
QUESTION: 6

Direct cost is also known as:

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QUESTION: 7

A firm’s total cost is Rs. 200 at 5 units of output and Rs. 220 at 6 units of output. The marginal cost of producing 6th of output will be ______.

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QUESTION: 8

The change in total cost due to one unit change in the output is called _______ cost.

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QUESTION: 9

Long run price is also called by the name of ________.

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QUESTION: 10

Units          0    1  2    3   4
Total Cost 20  30 40  45  50
What will be the AFC at 4 units of output?

Solution:
QUESTION: 11

What will be marginal cost of 67 units of production accounting to the table given below: Solution:
QUESTION: 12

Cost in terms of pain, discomfort, disability involved in supplying the various factors of production by their owners are termed as________.

Solution:
QUESTION: 13

Supply curve remaining unchanged, an increase in demand will lead to.

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QUESTION: 14

What will be the TVC if we produce 2 units?
Units  0    1    2
TC    20  37  50

Solution:
QUESTION: 15 Calculate AFC at 2nd unit of output

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QUESTION: 16

AFC curve is:

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QUESTION: 17

Which of the following is known as Envelope curve?

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QUESTION: 18

The larger the diameter of a natural gas pipeline, the lower is the average total cost of transmitting 1,000 cubic feet of gas 1,000 miles. This is an example of:

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QUESTION: 19

A firm’s average fixed cost is Rs. 20 at 6 units of output what will it be at 4 units of output?

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QUESTION: 20

When shape of average cost curve is upward, marginal cost :

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QUESTION: 21

Calculate AFC of 3 units form the following data:
Unit           0    1    2   3
Total cost 30  40  50  60

Solution:
QUESTION: 22

Which curve is never U-shaped?

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QUESTION: 23

Suppose, the total cost of production of commodity X is Rs. 1,25,000. Out of this cost implicit cost Rs. 35,000 and normal profit is Rs. 25,000. What will be the explicit cost of commodity X?

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QUESTION: 24

The total cost incurred for 10 units is Rs. 400 and 20 units is Rs. 800. Find the marginal cost.

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QUESTION: 25

Opportunity cost is :

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QUESTION: 26

Implicit cost may be defined as the :

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QUESTION: 27

A firm’s average fixed cost is Rs. 20 at 6 units of output. What will it be at 3 units of output?

Solution:
QUESTION: 28 Find Average Fixed cost of 3 units

Solution:
QUESTION: 29

Returns to scale will said to be in operation when quantity of:

Solution:
QUESTION: 30

External economies accrue due to ________:

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